Bonds have done so poorly this year because interest rates have gone up really fast. That essentially means that the value of the bonds that you hold is lower. There's also credit risk in the bond market, but personally I think the credit risk of the US government is quite low. But credit risk is still something to keep in mind if you're investing in bonds from emerging economies or from companies that aren't maybe in the best financial health. And there are a lot of bonds that they're thinly issued and no one wants to buy them as it might be a big deal withdrawing money from Bond markets. You're always going to be able to find a buyer for these bonds at the exact price
IN THIS EPISODE, YOU’LL LEARN:
02:16 - The benefits of including bonds into a portfolio.
06:03 - The risks that bonds are subject to: interest rate risk, inflation risk, credit risk, liquidity risk.
19:45 - What the term structure is, and why a normal yield curve is upward sloping.
20:27 - A deep dive into the different types of bonds investors can buy.
22:25 - Where investors can purchase different types of bonds.
29:31 - What I Savings Bonds are and the benefits they offer in this environment.
42:53 - What preferred shares are, and examples of different types of preferred shares.
And much, much more!
*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.
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